Labor Day blues

The most recent unemployment rate for Kershaw County indicates that we have experienced three straight years of double-digit unemployment: 10.5 percent in July 2011, 10.6 percent in July 2010, and 10.8 percent in July 2009. This is in sharp contrast to unemployment rates for July 2008 (7.2 percent) and July 2007 (5.7 percent).

On the brighter side, Kershaw County is one of 16 counties that are at or below the state rate. The state’s seasonally adjusted unemployment rate for July 2011 is 10.9 percent. On the darker side, South Carolina has the fourth highest unemployment rate in the nation.

As the members of the Class of 2011 begin their job hunt, they are finding it much tougher than their predecessors. According to a May 2011 Rutgers University study, “90 percent of students who graduated in 2006 or 2007 reported having at least one job in the year following graduation while that rate fell to 56 percent for those who got diplomas in 2010.” In addition, starting salaries have dropped for recent graduates who have found work.

Moreover, some job seekers are having a harder time finding a job than others. Everyone -- from the President to high school principals -- preaches about the importance of a diploma. The bare-knuckle truth is that the unemployment rate for those who have not earned a college degree is twice as high as it is for people who have a college degree or more.

According to the Bureau of Labor Statistics, July 2011 national data shows the unemployment rate was 14.1 percent for people with less than a high school degree, 9.1 percent for people with a high school diploma, 8.5 percent for people with some college or an associate’s degree, and 4.7 percent for people with a bachelor’s degree or higher.

If recent graduates want to improve their job prospects, they could look into booming niche industries. Among the 14 industries that a report from the University of California San Diego Extension highlights as hot growth areas are health care information technology (health care and information technology also stand on their own as strong fields), data mining, teaching adult learners, mobile media, embedded engineering, marine biodiversity and conservation, and online feature writing.

What can we do in South Carolina to put people to work?

A new study just released on Aug. 25 from the Moore School of Business argues that our best bet for job growth in South Carolina lies with local, high-impact firms. Essentially, high-impact firms are those that register strong sales growth and are headquartered in South Carolina.

The study found that local, high-impact firms accounted for only 2.7 percent of private-sector businesses in the South Carolina, but contributed 66.8 percent of all net employment gains. These numbers suggest that our state does well during a business’ entrepreneurial and incubation phases. The challenge to South Carolina is to have these small to medium local start-ups develop into “regional and national champions” headquartered in the state.

According to the study, some of the high-impact firms that experienced high employment growth were in the professional/technical services and construction related industries. Significant employment growth was also found in high-impact firms associated with machine tool products, distribution services, plastics, processed metals, and automotive products.

In addition to nurturing home-grown firms, South Carolina needs to have a smart and aggressive recruitment effort. To attract jobs to our state, we should at least do two things: lower our tax rates and be committed to quality public education.

Our tax rates are too high! Currently, South Carolina ranks 15th highest in sales tax, 13th highest in top income tax bracket, and fifth to seventh highest in business/commercial and industrial property tax. Furthermore, our tax structure is full of exemptions that favor special interests over the taxpayers. All of this puts our businesses and job creation efforts at a competitive disadvantage. Tax reform is needed to create a tax structure that lowers tax rates, is more transparent and equitable, and will make our state more competitive.

We need to stay committed to supporting and improving public education so that we have a statewide work-ready and marketable workforce. We need to support our universities and technical colleges so that they can keep our best and brightest here. In addition to providing higher education, universities are magnets for creativity and are incubators for new businesses. Technical colleges provide accessible job training opportunities for our state’s residents. These institutions collaborate with industry on research and job training that greatly contribute to our economy.

Having the fourth highest unemployment rate in the nation is a brutal reality that hits home for many South Carolina families. Policymakers need to do more to make our state attractive to business development and job creation. Putting our citizens back to work should be our number one priority.